Filing taxes as self-employed for the first time

[tax_payers]

Hi, I recently quit my job and started a business self-employed. I've set up an LLC and now I'm facing the fun of dealing with taxes directly myself 😉 I have a few questions that I'm struggling to find answers to:

+ I set up the LLC in July, but I don't have any income yet - I've done work but my first invoice will be in September and will get paid in October for work that I've done since I started. I plan to use cash-based accounting. Do I need to file quarterly estimated taxes on 9/15?

+ If I don't have to file on 9/15, are there any implications for expenses? I've had business expenses since I started, do I need to file quarterly estimated taxes in order to deduct those, or can I deduct Q3 expenses in my Q4 estimated taxes, when I actually have received payment for my work?

+ Can TurboTax do the estimated quarterly filing for me? how do I do it?

Thanks in advance for the help,

Rafael

[Anonymous_]

Since this is your first year as an LLC, you might want to seek professional tax guidance.

For the period of September 1 to December 31, estimated taxes are due January 15 of the following year (in this instance January 17, 2022).

See https://www.irs.gov/payments/pay-as-you-go-so-you-wont-owe-a-guide-to-withholding-estimated-taxes-an...

There are no implications for deducting expenses. You can deduct expenses irrespective of whether or not  estimated taxes are paid.

TurboTax will prepare Form 1040-ES, but you would essentially have to prepare a (test or estimated) return that you would not file with the software for the 2020 tax year. Doing so would require you to estimate the income and expenses for this tax year. 

You can make estimate tax payments online or via EFTPS (after registration) - see links below.

Online: https://www.irs.gov/payments

EFPTS: https://www.eftps.com/eftps/

[tax_payers]

Thanks for the quick reply. I understand from your answer that I don't need to file estimated taxes on Sep 15, as they will be 0 because I haven't made any money between June 1 and Aug 31, right?

Very helpful to understand how to do it with TT when I have to file in January.

Thanks!

[Anonymous_]

---

@tax_payers wrote:

.....I understand from your answer that I don't need to file estimated taxes on Sep 15, as they will be 0 because I haven't made any money between June 1 and Aug 31, right?

---

That is correct. The IRS goes by a set schedule, estimated payments are made on January 15th of the year following the final period of the tax year (e.g., estimated payment for income received (or credited) between September 1st and December 31st is made on January 15th of the following year).

[tax_payers]

Thanks a lot for the quick answer. These are good news, less to worry about as I keep building the business 😉

I was not sure if I had to do it and report 0, independently of having income or not, or if having an LLC required any quarterly filing.

Have a great weekend!